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5 Things You Should Know About Tax Audits

Common Law PC Jan. 31, 2023

Filing and paying taxes can be momentarily painful. Taxpayers who fail to file taxes are,  subject to harsh civil penalties. However, the Internal Revenue Service (IRS) can make mistakes due to human errors.

So, if the IRS says you owe an outstanding tax debt, you shouldn’t take their word for it. Reliable tax attorneys in Salt Lake City, Utah, can help save you from inaccurate and unnecessary tax payments. Keep reading for five things to help you navigate tax audits.

Return Omissions

Failing to report income is a red flag for the IRS. The IRS has many ways in which income is reported to it, and missing income is flagged and the IRS often follows up to find out why its records don’ match your return. Remember to include all of your income: including payments like dividend income, salary, or interest. The IRS expects you to include every source of taxable income.

Negotiation With the IRS

You can have an ongoing discussion with the auditor to keep the audit focused and to minimize any assessment of interest, penalties, and tax. Trusted tax lawyers in Utah can advocate for you to get the best possible results.

Failure to File

While there are certain circumstances where you don’t have to file a tax return, an unexplained gap in filing returns raises a red flag.  If you fail to file a return when you needed to, the IRS will likely follow up on that failure.  If the problem persists, the IRS can eventually file a return for you.  Of course, the return they file will not be the best at minimizing your taxes and letting the problem go that far can have other consequences.

Audit Result

After an audit, many taxpayers owe the tax authority more money. However, that isn’t guaranteed to happen. Proving your tax returns were accurate doesn’t result in an increased tax bill. After an audit process, you might end up owing nothing more, and on rare occasions, we’ve even seen taxpayers come out ahead.

Right to Representation

Our tax attorneys have expertise in real estate, corporate law, and other financial areas. They help you in tax related issues such as:

  • calculating your tax liability

  • defending you in tax court

  • representing you in an IRS audit

  • advising you on tax return issues

  • advising you on tax planning methods

  • strategizing the most effective course of action for your tax debt

Contact a Tax Penalty Attorney in Salt Lake City Today

Don’t dread being audited. Instead, maintain detailed, organized records of expenses and revenues. Thankfully, a good Utah tax attorney can help you understand your payment requirements and tax filing obligations and interpret an IRS or State letter.

Contact us today for guidance on tax audits to help you save time and money.